DESCRIPTION (taken from the application) Diabetes mellitus is a significant health problem, affecting approximately 16 million people in the United States. Loss of sufficient insulin production by the pancreatic beta cell is a hallmark of both type I and type II diabetes. The homeobox transcription factor Pdx1 (pancreatic and duodenal homeobox gene 1; also known as IPF-1, IDX-1, STF-1) is a master regulator of pancreatic development, as its homozygous deletion leads to pancreatic agenesis in mice and men. In addition, heterozygous mutation of Pdx1/IPF-1 is linked to early onset non-insulin dependent diabetes mellitus (MODY4). Recently, the winged helix transcription factor HNF (hepatocyte nuclear factor) 3Beta was shown to be an important regulator of Pdx1 transcription in the developing pancreas. Consequently, it is likely that HNF3Beta plays an important role in the control of pancreatic development and that HNF3Beta mutations can contribute to the pathogenesis of diabetes. However, gene targeting of HNF3Beta has thus far been not informative in this regard, as embryos homozygous for a null mutation die before the onset of pancreatic development. Therefore, we propose to assess the function of HNF3Beta in pancreatic development and physiology through conditional gene targeting using the loxP/Cre recombinase system. In preliminary work required for this proposal we have already generated and tested mice homozygous for a loxP-flanked HNF3Beta gene, the HNF3BetaloxP/loxP mice, and obtained Beta-cell specific Cre-recombinase transgenic mice. The specific aims of this proposal are: First, we will investigate whether HNF3Beta is required for pancreatic development through crosses of our HNF3Bet loxP/loxP mice with pancreas-specific Cre-recombinase transgenics. If our hypothesis is correct, deletion of HNF3Beta in the pancreas will lead to abnormal pancreatic development depending on the timing of deletion. Pancreatic development will be assessed by histological and immunohistochemical criteria. Second, through the use of a Beta-cell specific and steroid-inducible Cre-recombinase, we will address the question whether HNF3Beta also controls the maintenance of the specific cellular phenotype of the pancreatic Beta-cell If this is the case, induced deletion of HNF3Beta will be reflected in a perturbation of cell lineage allocation in the pancreatic islet and/or the regulation of glucose homeostasis. Together these studies will further our understanding of the transcriptional regulation of pancreatic development and the pathogenesis of diabetes. Insights gained about the role of HNF3Beta in Beta-cell function could be incorporated into future therapeutic strategies, including gene therapy.